Winter 2000 (8.4)
Aid to Baku - Section 907
The U.S. Embassy to
with Ambassador Stanley Escudero by Betty Blair
In 1991, the event that
the West had been waiting decades for finally happened - the
Soviet Union collapsed. Relieved that the Cold War was over,
the U.S. vowed to help the former Soviet republics make the transition
from centrally controlled economies to free-market systems supported
by democratic governments. And for the most part, the U.S. made
good on that promise, having set aside more than $8.3 billion
between 1992 and 2001 to help the Newly Independent States (NIS).
However, in the case of Azerbaijan, interference by Armenians
living in the U.S. prevented the Republic from receiving support.
The U.S. Congress, bowing to special interests, has blocked direct
aid to Azerbaijan's government via Section 907 of the Freedom
Despite carve-outs that, since 1998, have allowed direct assistance
to Azerbaijan for democratization and humanitarian purposes,
the U.S. has allocated a relatively meager amount of aid to Azerbaijan,
as compared to the other Caucasus Republics - Armenia and Georgia.
Most of the aid that Azerbaijan does receive is administered
through U.S. non-governmental organizations (NGOs).
Here Stanley Escudero, the U.S. Ambassador to Azerbaijan (1997
to 2000), speaks with Editor Betty Blair about the impact that
Section 907 has had on U.S. efforts to assist Azerbaijan. Escudero
elaborates on how restrictive this piece of legislation has been,
how it damages U.S. relations with Azerbaijan, and what it means
not to be able to fully assist the Azerbaijani government at
this crucial moment in history.
Above: America's hands are
tied because of U.S. Congressional legislature (Section 907 of
the Freedom Support Act) when it comes to directly helping the
Azerbaijani government find work out solutions to its major environmental
problems. Above: Factory in Sumgayit, an industrial hub of Baku.
This interview took place in the U.S. Embassy in Baku on September
19, 2000, just a few days before Escudero's assignment ended
and he retired from diplomatic service. He and his wife, Jaye,
now reside in Florida. In October, Ross Wilson assumed his duties
as the new U.S. Ambassador to Azerbaijan.
Let's start with the good news first and talk about the positive
ways in which the U.S. is assisting Azerbaijan in its development.
Considering the relatively small amount of aid that the U.S.
has allocated to Azerbaijan, which projects do you think will
make the greatest impact on the country-long-term?
Because I hope and believe that the refugees won't remain refugees
forever, I attach great importance to income-generation projects
and business development projects that assist refugees and other
Azerbaijanis in creating new wealth and in making a personal
contribution to the development of free-market enterprise in
But beyond that, I'm convinced that the most important thing
that we do in Azerbaijan has to do with our student exchange
programs. The largest of these is the FLEX Program (Future Leaders
Exchange) which used to be called the Bradley Program. It was
established in 1992 right after the Soviet Union collapsed ,
when we opened all of the Embassies in the Newly Independent
Above: Dead seal washed up
on beach at Dashlar Island because of oil pollution.
In Azerbaijan, the first exchange students left for the U.S.
in the fall of 1993, didn't they?
correct. We've now sent in the neighborhood of 600-700 students
from Azerbaijan to the United States. These past several years,
we've been able to increase the number of FLEX students that
we've been sending to America. Sometimes, dramatically so. Competitions
administered by ACTR-ACCELS are held in each NIS country, where
students are chosen according to their ability in English. The
students go to live with American families throughout our country
and attend high schools for one year.
Then they return to Azerbaijan to pursue university studies here.
But they return with an extraordinarily different outlook and
an understanding of America that very few Azerbaijanis have because
they've spent a lot of time in intimate American settings. Their
young minds are like sponges that absorb everything they see
and experience. But not only do they bring back a greater realization
of what America is all about, they return with an awareness that
there are different ways of doing things.
They become sensitive to what makes the West more effective and
more efficient in the world today.
We hope this instills a desire to see their own country improve
and adopt some of these methods and systems. Sometimes this makes
for problems. Their families don't always understand their new
way of thinking. And, of course, as young people, they aren't
usually able to immediately replicate the experiences they've
had in the West, so there is often a period of readjustment for
them, which can be frustrating.
Left: Despite U.S. law prohibiting direct
aid to the Azerbaijani government, the Clinton Administration
managed to create exceptions so that humanitarian aid could be
directed to refugee projects. This young refugee girl, leans
against the ladder leading up to the railway box car where she
has spent all her life growing up. There are hundreds of young
people like her. Saatli. Photo: UNHCR, Vugar Abdusalimov.
In addition to the FLEX program, we have university and graduate-level
study grants such as the Muskie Program. One of these, the Harvard
MBA Program, was inaugurated just this past year.
As Azerbaijan develops and prospers, it will inevitably have
to mesh with the international community. These young people
- graduates of these programs - will be on the cutting edge of
that process. We think that, over time, these young people will
be the "movers and shakers". They will become the technocrats
who help with the "nuts and bolts of change".
It's not just the individual student who benefits directly
from these programs. The entire family benefits - parents, brothers,
sisters and relatives.
That's certainly true. In fact, one of the phenomena that we've
seen repeated time after time is that brothers and sisters of
graduates apply for these programs as well, and I should add,
But now let's focus on some of the things you can't do in
Azerbaijan because of the restrictions on aid imposed by the
U.S. Congress. Of course, one could argue that no country that
comes to rely heavily on foreign aid will develop much on its
own. Each country must find ways to develop independently. Take
a look at Armenia, a country whose population is barely half
that of Azerbaijan's, but which has received perhaps five times
the amount of U.S. government aid. Yet Azerbaijan's economy is
far more developed than Armenia's. What are some of the ways
that 907 has hampered your efforts at the U.S. Embassy in Baku?
There are many ways. In fact, 907 has essentially retarded the
development of the cooperative relationship that ought to exist
between the United States and the government of Azerbaijan. In
other NIS countries, we have a very wide range of programs directly
with the governments. We assist them in the creation of, the
reform of, or the development of a wide range of institutions
and practices that will better enable them to prepare themselves
for participation in a free-market world. But in Azerbaijan,
we work under very heavy restrictions.
For example, Section 907 has prevented us from helping Azerbaijan
develop a coherent and effective tax collection system. Furthermore,
it has, until quite recently, prevented us from getting involved
to help change Azerbaijan's judicial system or to reform a variety
of laws that would facilitate democratic practice. It continues
to prevent us from helping Azerbaijan change its commercial code.
Section 907 prohibits the U.S. from providing direct aid to Azerbaijan's
government, even to support educational endeavors such as reprinting
text books. As the law stands, the U.S. could not even provide
funding or expertise to help rewrite and republish world history
texts from a non-Soviet point of view. Azerbaijan is the only
Republic of the 12 former Soviet republics that has been denied
direct aid, as a provision to the Freedom Support Act passed
in 1992. The exception was brought on by Armenian activists who
fund the election campaigns of U.S. members of Congress.
Govermental officals both in Azerbaijan and the United States
who understand the effect of these unfair laws insist that such
legislation is detrimental to development in the entire region
and even has long-term negative effects on neighboring Armenia.
Above: Baku State University
as a government institution cannot receive U.S aid, nor can elementary
school kids who attend public schools (below).
the laws that govern commercial activities in Azerbaijan. It
prevents us from assisting Azerbaijan in developing the more
transparent, investor-friendly climate that is necessary for
Azerbaijan to attract foreign investment, especially in the non-energy
sector. The development of the non-energy sector is absolutely
critical to the success of this country because it will be the
non-energy sector and the intelligent use of oil revenues that
will prevent Azerbaijan over time from experiencing the devastating
problems that afflicted other petro-states of the 1970s.
Since 907 has been interpreted quite strictly, we have been unable
to provide Azerbaijan assistance in the control of narcotics
traffic. That remains the case, even though the authorizing language
that creates counter-narcotics assistance programs contains what
is called a "not-withstanding clause", meaning that
this kind of assistance may be provided to countries "not-withstanding
any other piece of legislation". One would think that such
clauses would enable an override of the 907. But the law has
been interpreted otherwise. I think that interpretation may change
There are other American assistance programs whose enabling legislation
includes "not-withstanding clauses" - the Peace Corps,
for example. Nevertheless, there is no Peace Corps in Azerbaijan.
I hope that, too, will change soon, and that the Peace Corps
will come to Azerbaijan. The Peace Corps has a proud global history,
and there is an opportunity in Azerbaijan for the Corps to make
important contributions to national development, especially in
areas such as English-language teaching and small-business development.
But with respect to our direct relationship with the government
of Azerbaijan, the very fact that 907 even exists is, for them,
an extraordinary and confusing humiliation. Azerbaijan is the
nation in this region whose interests most closely parallel those
of the United States. It is a nation that desires to be close
When you speak about the "region", how wide is your
Well, I'm referring to the Caspian basin and, of course, to the
South Caucasus. Azerbaijanis find it very difficult to understand
how the United States, which is generally regarded as a fair
and just country, could pass such a piece of legislation. Furthermore,
they find it even more difficult to understand how the United
States could maintain it year after year.
So how do you explain it to them?
Well, I explain it as a function of domestic American politics.
Do you see any possibility that it will change?
When there is a settlement in Nagorno-Karabakh, of course, it
will change. It's also conceivable that there could be some more
"carve-outs" - some other exemptions created. But I
don't anticipate that the Congress will repeal Section 907, no.
Left: Life in a railway box car is all this
refugee child has ever known. Of all the temporary shelters that
refugees have found to live in, these are considered among the
least desirable. They're too hot in summer and too cold in winter,
with no windows to provide light or ventilation. Saatli. Photo:
UNHCR, Vugar Abdusalimov.
Simply because some Congressional members are being funded by
There is no countervailing Azerbaijani lobby. Political realities
in the United States are such that the Congress will respond
to domestic constituencies, especially wealthy, well-organized
But that's corruption, isn't it?
Some people would call it that. Others describe financial contributions
as a form of free speech and insist that the current level of
influence of special interest groups in the United States is
nothing more than the American political system at work.
Azerbaijanis often say that it's not the money so much as
the lack of integrity that bothers them most. They say: "We
really depended on the United States to be just and true and
honest. We were the victims of this conflict and now they're
punishing us. The aggressors are the ones being rewarded."
Well, again, I can certainly understand why they would feel that
There's also another aspect of U.S. aid that I find very problematic.
On the one hand, the U.S. recognizes that Karabakh is still part
of Azerbaijan, as does the rest of the international community,
with the exception of Armenia. On the other hand, it denies direct
aid to the Azerbaijani government while giving aid to Karabakh,
which is now populated only by Armenians, since all the Azerbaijanis
were forced to flee their homes and villages. It seems like such
a contradiction and so unfair.
earmarked $20 million to be spent in Nagorno-Karabakh over a
three-year period. That's an extraordinary amount of money if
you consider that there are only 100,000 or so people in all
of Nagorno-Karabakh. [The Azerbaijani government estimates that
there are approximately only 40,000 civilians, all of them Armenian,
living in Nagorno-Karabakh]. But again, this is a function of
domestic American politics.
My primary concern with 907 is that it is an attempt to impose
unilateral sanctions on Azerbaijan-a strategy that is almost
always a mistake in foreign policy. Moreover, in this particular
situation, the legislation does not reflect the conditions on
the ground. It simply does not reflect the history of the Nagorno-Karabakh
issue. Instead, it shows the influence of the Armenian lobby
in the United States and the influence of campaign financing
on decisions made by the Congress. This is a particular problem
in our country right now, and it is only one example out of many.
Have you addressed Congress about these things? The State
Department seems to know the issues.
The State Department would gladly repeal this legislation if
it had the authority to do so. And no, I have not addressed the
Congress directly on this issue. Congress has not requested my
Can you elaborate a bit more on some of the other activities
that you haven't been able to carry out because of 907? Like,
for example, English books? Has it been difficult to bring textbooks
Well, if we
wanted to support a program that would assist Azerbaijan in the
reconstruction of its educational system, or in the provision
of modernized textbooks that deal with, let's say, world history
from a non-Soviet point of view, we would not be able to do it
without a specific exemption from 907.
Such a program would require offering them to the Azerbaijani
school system, which, of course, is part of the government of
Azerbaijan. Therefore, we couldn't do that. It wouldn't matter
if the books were in the English language or in Azeri. We are
able to obtain waivers for certain programs, but these waivers
must be requested and justified on a case-by-case basis.
For example, there are the partnership programs between Azerbaijani
schools and American schools, funded by Public Diplomacy and
other similar programs. I don't have the list at my fingertips,
but the point is that each one of them requires an individual
waiver that may not be granted, and which in any case adds to
the overall administrative workload for the assistance programs.
Section 907 prevents us from doing many of the things we should
be doing to advance American interests in Azerbaijan and to assist
Azerbaijan in developing towards prosperity and continuing stability.
For example, we can't sit down with Customs officials and devise
U.S.-funded programs to help them reform their customs structure
in a way that would make it friendlier to American business.
Because of the critical importance of an investor-friendly business
climate for American and Azerbaijani interests, we encourage
the American Chamber of Commerce (AmCham) to do this.
Fortunately, they've been quite successful and have enjoyed close
cooperation with the Azerbaijani customs department, but this
has been an ad hoc effort that should support and supplement
but not substitute for the carefully planned reform programs
that USAID has developed in other NIS countries.
Unfortunately, with 907 in effect, we are unable to fund needed
programs such as customs reform in Azerbaijan. Both American
business and our national interests would benefit from the development
of an investor-friendly climate here.
What about medicine?
That falls into the category of humanitarian assistance. We have
undertaken fairly extensive health programs, particularly those
involving the health of lactating mothers and children's health
programs. Those types of programs began with refugees but have
not been limited to that population.
Anything that can be considered humanitarian aid can be funded
under Section 907 as currently amended. Of course, in light of
the number of Azerbaijan's refugees and internally displaced
persons (IDPs), which is the largest per capita of any nation
in the world [approximately 1 million refugees in a population
of 8 million people], there is a need for far more assistance
than is allocated.
In time, that need will diminish as Azerbaijan develops its oil
and gas resources and acquires the capacity to better respond
to its own refugee problems. But that time will not come for
several more years. The inadequacy of our assistance levels is
especially glaring when compared to the much larger amounts given
each year to the other two South Caucasus nations of Georgia
and Armenia, which benefit from Congressional earmarks.
An earmark is a decision by the Congress to designate specific
amounts of money to be appropriated under a particular bill.
For example, in the case of the Freedom Support Act, "x"
number of dollars are appropriated for Armenia, Georgia and the
Ukraine. After the earmarks have been subtracted, the remaining
funds are divided up among the nine other countries competing
for them, which is an allocation made within the State Department.
This is what Bill Taylor's office does. [See interview with Ambassador
Taylor in this issue.]
What about help in terms of educational processes, like providing
access to computers so that students and faculty can become more
Well, it depends on whether the assistance is going to a private
institution or a governmental one. If you look, for example,
at Western University in Baku, you'll see that we've helped set
up a fairly extensive computer center that is connected to the
Internet. We funded that. But Western is a private university.
You will also note that there is no similar American-provided
computer center at Baku State University, even though BSU is
a much larger university. Since it's an official government university,
we can't provide them assistance because of the restrictions
imposed by Section 907.
Also on the education side, we run health education programs
that are administered by NGOs within the refugee camps and villages.
What about agriculture? That's a huge area that needs to be
I agree. But again, we cannot work directly with governmental
structures. We are working with individual farmers, particularly
in regard to individual animal husbandry. In several parts of
the country, we've set up a farmer's credit association in conjunction
with veterinarian services to help maintain healthy livestock.
The credit association helps the farmers pay the vet's bills
and also serves as a forum for information exchange and livestock
service. Eventually, it will probably evolve to include a leather
tanning operation. We also help Azerbaijani farmers learn better
how to produce and how to market.
We are just about to launch such a program in Zagatala, in the
western part of the country. This is a lovely area! It's particularly
fertile country, somewhat mountainous, but it also includes a
broad, fruitful valley area that enjoys good water drainage from
the Caucasus. Farmers in that region raise mulberries, hazelnuts
and wheat. They breed cattle and produce leather, meat and dairy
products. They cut timber from the mountains. They used to have
a sizable cement factory there during Soviet times, which could
profitably be rehabilitated to satisfy the growing regional market.
So it was a very productive region in its day, and its economy
could be stimulated again. I hope that our programs will catalyze
this process. It already enjoys some cooperation with TACIS [a
European Union program that provides technical assistance].
What about science, scientific investigation or exchanges
This would be more difficult for us because it would require
cooperating with the Academy of Sciences. Again, the Academy
is a governmental structure and thus off-limits under the strictures
Looks like the assignment here in Baku "ties your hands"
Section 907 ties our hands, yes. Because of 907, the U.S. Ambassador
in Azerbaijan is required to achieve America's goals with one
hand tied behind his back. It certainly makes the job challenging-no
doubt about that.
But also, when you get U.S. NGOs involved, for example, instead
of carrying out the task directly with Azerbaijani personnel,
a lot of money ends up being eaten up just administrating these
programs. Of course, one could argue that somebody has to organize
these programs. But there's a big difference in funding American
administrators who have to fly back and forth to do the job,
compared to funding Azerbaijani administrators. To me, it looks
like you end up turning somersaults to do things that could have
been done more directly and more cheaply if you didn't have these
I have never actually addressed administration as a function
of cost. But certainly there would seem to be additional administrative
costs involved in dealing through a number of NGOs, rather than
directly through the Azerbaijani government if only because the
government's administrative costs are funded by itself.
What other areas are affected by 907? Oil, of course, is usually
taken care of by the oil companies themselves.
The U.S. government doesn't get involved in financing the oil
and gas development of the country. As you can see, the companies
are quite capable of financing their own activities - more so
than we are. We do provide political support and assistance for
American companies, however, and are prepared to provide quite
a bit more in matters involving pipelines.
Energy development in the Caspian basin is not the subject of
this interview, but I'm sure you are aware of the strong U.S.
commitment to multiple energy export routes from the Caspian
to market and especially to the Baku-Tbilisi-Jeyhan Main Export
The U.S. government is prepared to offer substantial financial
support for this line. For example, the Trade and Development
Agency (TDA) is prepared to finance pipeline-related feasibility
In Ankara, we've set up an unprecedented form of cooperation
between TDA, OPIC and EXIM Bank, which we call the Caspian Finance
Center. Its purpose is to assist in financing worthwhile projects
for the development, primarily, of energy in the Caspian basin
area, and we are looking into pipelines now - where EXIM can
finance aspects of pipeline construction that involve American
materials, or OPIC could provide risk insurance, and TDA can
do feasibility studies.
That doesn't mean that we're going to finance the construction
of the pipeline. That would be done commercially by the companies
because frankly, that in itself is a test of whether or not the
pipeline will be a commercially viable entity. And if it isn't
commercially viable, neither we nor the companies would support
What about the environment?
Provision of U.S. assistance to protect the environment in Azerbaijan
is also precluded by 907.
Can you give some examples of how it has hindered some projects
that you might have liked to be involved with?
The government here has its own environmental structures. For
example, they are trying to start a government-sponsored Environmental
University. University officials have asked us for assistance,
but we can't help them.
Were it not for 907, we would certainly consider their request.
We would also develop proposals on our own for USAID-funded programs
to assist Azerbaijan in the cleanup of the many toxic areas left
behind by the rape of the Azerbaijani ecosystem perpetrated by
the Soviet Union.
And we would probably propose ways to help them protect the endangered
Caspian sturgeon, which is the basis of their caviar industry.
But 907 will not permit us to do any of this. As you well know,
we all live on the same small, interdependent planet, and when
the environment is neglected, everyone suffers.
A wide range of environmental questions is being addressed by
this government as they routinely begin to clean up. They're
trying to ensure that the companies that locate here adopt and
adhere to environmental standards that are internationally recognized.
They want to protect their habitat at the same time as they develop
it. We have a lot of expertise on this subject in the United
States. We could provide them with advisors, information and
assistance, but we simply are not permitted to do so.
What about cultural projects?
Again, if it has anything to do with the government, it would
be impacted by 907. And then there's the whole question of our
relationship to the Azerbaijani military. Often, the United States
has a wide variety of assistance programs for militaries in other
countries. Some are lethal, some are non-lethal.
In this particular case, we have a two-fold problem. On the one
hand there is 907, and on the other, there is the fact that Azerbaijan
is still technically at war with Armenia. And so, even if it
were not for 907, we would be constrained by our general policy
of not militarily assisting states that are in a state of conflict.
We don't assist Armenia either, of course, when it comes to matters
related to the military.
Of course, there are cooperative programs under Partnership for
Peace (PfP) that are offered equally to both countries and to
all other PfP members as well. This is a NATO program to which
most of the former Soviet states, including Russia, belong. Because
it is funded by NATO, Azerbaijan's participation is not precluded
by Section 907. But I can assure you that none of our aid is
directed to the Armenian military.
But what about the patrol boats that will be coming to Azerbaijan
soon to use for guarding against narcotics trafficking?
We're not giving them to the Azerbaijani military - we're providing
them to Azerbaijan's maritime border guards, that is, their Coast
Isn't that governmental?
Yes. But we're doing it on the basis of an exemption, a "carve-out"
from 907, that permits assistance in counter-proliferation activities.
Provision of the patrol boats is part of a very specific, very
narrowly focused assistance effort that will help Azerbaijan
control its territorial waters and prevent passage of weapons
of mass destruction, fissile material and other precursors of
weapons of mass destruction. The program can have no impact on
Armenia because, of course, Armenia has no coastline on the Caspian.
Let me make clear that American aid is carefully controlled.
A lot of people think that when it comes to international aid
that we just sit down and write a check to the government, and
then they go carry out the programs. In fact, Israel is the only
country in the world for which that level of cooperation resides.
With other countries, we agree on programs, we establish programs,
but we control the expenditure of the funding and we don't actually
give money. We provide advisors, we provide training, and sometimes
we provide "aid in kind", but we don't actually give
the countries direct funds.
Before we conclude this interview, I would like to re-emphasize
the importance of assistance to the development of a vibrant
and self-sustaining private sector in Azerbaijan - assistance
that is prohibited by Section 907.
It is absolutely vital to enhance and accelerate the transition
between the kind of controlled economy that Azerbaijan inherited
from the Soviets and the kind of free-market, investor-friendly
economy that Azerbaijanis would like to develop. In fact, they
must develop it, and they can develop it.
With the support of American USAID assistance programs and in
cooperation with Western business, it's vital to create an indigenous
middle class and create new wealth. Over the next 10 years or
so, Azerbaijan will become a very wealthy nation through the
development of its vast energy resources. The trouble with developing
a country solely on the basis of oil and gas rents is that the
money only extends to about 30 percent of the population at very
best, leaving a substantial majority outside of the umbrella.
If you don't have other development in the non-energy sector,
then you won't have a non-energy tax base, leaving the national
budget seriously over-dependent on a single sector of the economy;
plus there will not be sufficient employment outside the energy
sector. This, in turn, means that the majority of the population
won't be able to deal with the inevitable inflation that will
come about when a lot more money appears in the economy.
Very quickly, a situation develops in which there are oil-based
"haves" and non-oil based "have-nots". In
other countries, this sort of imbalance has led to severe political
consequences. This skewed situation is not something that Azerbaijan
wants for itself. It's something that the government is aware
of; they understand the risk and are taking steps to try to head
off this kind of problem. The United States could help them with
this - and we would like to help them with this-but we can't.
be your advice to the new Ambassador in terms of 907? [Ross Wilson's
credentials as the new U.S. Ambassador to Azerbaijan were presented
in October 2000 after this interview was made].
I have held discussions with Ambassador Wilson and will do so
again when I go back to Washington before he comes out here.
We've talked about the problems that we are discussing here today
as well as other issues of the U.S. - Azerbaijan relationship.
He is well-versed on Azerbaijan both by virtue of his experience
as principal deputy in the bureau responsible for the nations
of the former Soviet Union and in the extensive preparations
required of all new ambassadors. I have every confidence that
Ross Wilson will make a superb ambassador, and I would not presume
to advise him further on how he should do his job.
It's too bad that 907 exists here, because when the Soviet
Union collapsed, I think the Azerbaijani people reached out to
embrace America. But as the years have passed, they're becoming
more hesitant and less trusting of the United States because
of this Congressional legislation.
I think that's true. I can understand the Azerbaijanis' difficulty,
particularly since we would like to cooperate more closely with
them as well. I think they aren't sure if they can trust us as
an honest broker. Always in the back of their minds is this nagging
question of whether they can truly consider us their friend if
this rather obvious legislative bias in favor of their regional
enemy continues to remain in effect.
For the United States, a stable, prosperous, democratic Azerbaijan
is key to the achievement of our policies and the protection
of our interests in the Caspian basin. But 907 takes away many
of the tools that we need to help Azerbaijan move toward those
goals. Yet for Azerbaijan, attainment of those goals is not fore-ordained.
Azerbaijanis live in a very dangerous neighborhood and need international
assistance to strengthen their position. If Azerbaijan fails
to succeed, the United States will fail in the Caspian basin
As I have often said, Azerbaijan is the keystone in the arch
of policy success for America in the Caspian. Without a successful
and cooperative Azerbaijan, there will be no East-West Energy
Corridor, no revived Silk Route, and no hope for stability in
the South Caucasus. A necessary step towards that stability is
the peaceful, negotiated settlement of the Nagorno-Karabakh question.
It's no secret that the Armenian economy is in deep trouble,
and that at least half of the population of Armenia has emigrated
since independence. This is not the result of the Nagorno-Karabakh
war. After all, the Armenians won the conflict; it is they who
occupy one-fifth of Azerbaijan's territory, while none of their
territory is being occupied by Azerbaijan.
Nor is it the result of the "blockade" which has to
rank among the least singularly ineffective strategies in foreign
policy. The fact is that a great deal of trade passes between
Turkey and Armenia via Georgia and Iran.
At the same time, gasoline is cheaper in Armenia than in Azerbaijan.
Armenia, unlike Azerbaijan, is in a position to export electricity.
Armenia's weak economic state stems, in my view, primarily from
its lack of resources or markets for its Soviet-era industries.
The future of Armenia's economic advancement will be driven by
its participation in the economic development of the South Caucasus
region, and that development is driven by Azerbaijan and the
energy-producing nations of the Caspian basin. But until the
Nagorno-Karabakh question is resolved, Azerbaijan will not permit
Armenia to become a transit route for energy pipelines. Nor will
Armenian industries be revived to support oil and gas development.
Nor will Baku agree to the establishment of U.S.-funded regional
development schemes for the three South Caucasus nations.
The saddest thing about 907 is that it benefits no one in the
South Caucasus - not Azerbaijan, not the United States, not even
Armenia. The truth is, everyone loses. Even Armenians, who initiated
this law in the U.S. Congress denying aid to Azerbaijan, are
victimized by the continued imposition of 907.
Neither Azerbaijan nor Armenia can fully develop economically
until there is peace in Nagorno-Karabakh. There are many obstacles
to such a peace, but I can assure you that the problem will not
be resolved as long as 907 bars the way. Along with Russia and
France, the U.S. plays a broker's role in attempting to facilitate
a settlement. [The U.S. is a co-chair of the Minsk Group of OSCE
- Organization of Security and Cooperation in Europe]. But our
task would be far less onerous and more likely to succeed if
907 did not cause the parties to question the capacity of the
United States to act as an honest broker in this affair.
The Clinton Administration has consistently opposed 907 and has
often called for Congressional repeal, without effect. I do hope
that the next Congress will be prevailed upon to repeal the effects
of 907, or that the next President will find it possible to waive
We need to clear the decks - to untie my successor's hands so
that he and the foreign policy community in Washington can join
with the governments of the region in unfettered pursuit of our
many common interests.
(8.4) Winter 2000.
© Azerbaijan International 2000. All rights reserved.
Back to Index
AI 8.4 (Winter 2000)
| Magazine Choice | Topics